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Business Finance: Cost of sick leave

In his weekly business banking post, our CFO Greg Taylor, says business cannot ignore the cost of sick leave and absenteeism. There are ways to address the issue.

Has your business been rocked by Winter colds and bugs? Has every day been disrupted because staff are off sick?

High sick leave and absenteeism is a real issue for your business bottom line that you can’t ignore. Research suggests that it costs millions of dollars each year. One survey I saw said that every sick day taken by an employee costs a business around $385. With as many as one in 40 workers sick each day the cost of sick leave soon mounts up.

A first step in containing this cost is to understand it. Your business needs systems to record and analyse sick leave so you have the full picture.

There are different reasons why people are off work sick. They can have a cold or bug, a child may be sick, they may have experienced an injury either at work or home or, ahem, they may be having a “sickie”.

What can you do to counter legitimate illness? Take an interest in your staff’s physical and mental wellbeing. You can’t tell them what to do but you can encourage or role model eating well and exercising. Staff who continually work long hours and have no work life balance have an increased chance of getting run down. Make safety paramount in your workplace.

Having workers turn up sick can be a false economy if they infect everyone else. Have clear guidelines and infection control procedures.

There is a clear link between high absenteeism and poor business culture. Making your workplace fun and fulfilling is one way to help make sure people want to turn up to work. Recruiting the right people, giving them the resources they need and rewarding them for a job well done, are three ways to start getting a high performance culture.

Less absenteeism is an important first step to better productivity and profitability.

What do you think? Got any tips for other business owners? Please share them below.

General advice on this website has been prepared without taking into account your objectives, financial situation or needs. Before acting on the advice, consider its appropriateness. Consider the relevant disclosure documents, which include Greater Bank's Terms and Conditions for Deposit and Credit Accounts for some products, Product Disclosure Statements (PDS) for others and Greater Bank's Financial Services Guide (FSG). The Terms and Conditions for Deposit and Credit Accounts or a PDS are relevant when deciding whether to acquire or hold a product.

By accessing and viewing this site you agree to be bound by the Terms & Conditions of this website.

General advice on this website has been prepared without taking into account your objectives, financial situation or needs. Before acting on the advice, consider its appropriateness. Consider the relevant disclosure documents, which include Greater Bank's Terms and Conditions for Deposit and Credit Accounts for some products, Product Disclosure Statements (PDS) for others and Greater Bank's Financial Services Guide (FSG). The Terms and Conditions for Deposit and Credit Accounts or a PDS are relevant when deciding whether to acquire or hold a product.

By accessing and viewing this site you agree to be bound by the Terms & Conditions of this website.